Contrary to the perception that big cities are responsible for driving up the growth of luxury cars, manufactures such as Mercedes Benz India and Audi India are actually seeing strong increase in numbers coming in from smaller towns and cities of the country.

Audi India, which had registered 11 per cent increase in sales in 2013 calendar year, says that the increase is much higher in smaller cities (tier 2 and tier 3). Our sales from smaller cities grew by 20 per cent, which is higher than the overall growth in sales. We realise the need to increase our presence in smaller cities and expanding our retail presence in smaller cities, said Joe King, head of Audi India. The company plans to add 5 more stores to its strength of 35 stores in the country and all these stores will be added in smaller cities. The company said that two of these five stores will come up in Noida in Uttar Pradesh and Vizag in Andhra Pradesh.

A good amount of our sales come from smaller cities. Delhi and Mumbai contribute 45 per cent of our sales and the rest comes from smaller cities, said Eberhard Kern, CEO of Mercedes-Benz India.